LG, on the VGX or the XVG or whatever symbol you prefer, candlestick-wise it don't look too pretty...
stockcharts.com
Today's session would clearly qualify as confirmation of the toppping formation described yesterday. The daily chart would clearly suggest further pullback. If you throw in the failure at the 200 Day MA, also a failure to make a new intermediate high, I'd think you'd have to consider a re-test of 400 and/or the 50 Day likely, unless that little snapback blip subsequent to the intermediate high provides support - that's all assuming that, in addition of course to considering candlestick analysis and SRL analysis and MA analysis "valid," you also believe that the VGX represents a "market" subject to the same modes of analysis that would be applicable to others. (This issue is one I find myself reflecting on frequently when dealing with less widely followed indices. I'd be interested in your thoughts on the matter.)
The weekly version of the chart essentially re-produces the same pattern, though, like the daily as of a couple of days ago (uptrend stalled at inverted hammer), awaits confirmation of the potential topping pattern (with, presumably, more serious, longer-term implications if this confirmation comes).
stockcharts.com[L,A]WACLYYMY[PB50!B200][VC60][IUB14!LA12,26,9]
While we're on the subject of candlesticks, the Nasdaq chart shows interesting distinctions between the daily and the weekly. The daily shows a mildly bearish (or at least non-bullish) "counterattack" line reflecting what Steve Nison (the leading American c-stick expert, far as I know, from whose work I take virtually all my candlestick analysis) would call a "stalemate between the bulls and bears." Interesting that in closing almost exactly on yesterday's high, after a gap up (classic definition of the counterattack pattern), the session also closed almost exactly on the 50-day, and almost exactly on an intermediate downtrendline - perhaps confirming them as support. Putting this all together, I wouldn't be surprised at all by a test somewhat lower, even some rummaging around in the zone above and below, but I think the weekly chart remains fairly bullish, offering the second piece of an "advance block," and suggesting that the rally may well have much further to go if 2859 - low for the week of 11/17/00 - can be handled successfully. That level also represented a potential support level that did not hold, and, as in Western modes of analysis, would offer potential resistance - as indeed it appeared to do today (with ca. 20 pts to spare). The area also corresponds to the upper range of a key congestion zone from Summer - Fall '99. |
